FEDERAL PUBLIC SERVICE COMMISSION Roll Number

COMPETITIVE EXAMINATION – 2021

FOR RECRUITMETN TO POSTS IN BS-17
UNDER THE FEDRAL GOVERNMENT

ACCOUONTANCY & AUDITING, PAPER-I

TIME ALLOWED: THREE HOURS PART-I (MCQS) MAXIMUM MARKS = 20

PART-I (MCQS): MAXIMUM 30 MINUTES PART-II MAXIMUM MARKS = 80
Note: (i) Part-II is to be attempted on the separate answer book.
(ii) Attempt ONLY FOUR questions from PART-II. All question carries EQUAL marks.
(iii) All the parts (if any) of each Question must be attempted at one place instead of
different places,
(iv) Write Q. No in the answer book in accordance with Q. No in the Q. paper.
(v) No Page/Space be left blank between the answers. All the blank pages of Answer
Book must be crossed.
(vi) Extra attempt of any question or any part of the question will not be considered.

PART-II
SECTION-I

Q2. You are required to prepare Income Statement for the period ending 31st December,
2019: (20)

Merchandise opening Inventory 18,000 Office Rent Expenses 2000

Sales Discount 4,000 Traveling Expenses 1,300
Sales Rent & allowances 2,000 Office Supplies Expense 700
Purchases 1,80,000 Interest Expenses 1,700
Carriage 1,600 Postage Expense 200
Sales Salaries 12,000 Insurance Expense 400
Rent Expense-Selling 1,200
Advertising expenses 1,400 Sales 2,17,000
Utilities expense-selling 900 Purchases Discount 1,700
Depreciation exp-selling 400 Purchases Ret. & Allow 1,300
Office salaries 8,000 Interest Earned 3,800

Q3. A, B are two partners sharing profits and losses in the ratio of 3:1 They admit K as a
partner and he pays Rs. 30,000 as capital. The new ratio is to be 3:1:1. The goodwill of
the firm is to be based on 3 year’s purchase of the average 4 year’s profits which are
Rs. 15,000, 12,000 18,000, 19,000:

Required:
Show the journal entries if:

(A) K pays for the goodwill in cash. (10)

(B) He is unable to bring the cash for the goodwill. (10)

Q4. XYZ purchased a delivery truck for the distribution of its finished product for Rs.
65,000 on 1st January 2013. The expected useful life of that truck was five years and a
salvage value of Rs. 5,000.

Required:
Calculate the following:
(A) The annual depreciation expenses by applying sum of the year digit method. (10)
(B) Pass journal entries and prepare depreciation schedule. Also state the assumptions
of this method.